The analysis Filecoin doesn’t want you to read
Stefano Bernardi
2.3K46

Your post sounds a little like sour grapes. Below are your points in bold and my take on them.

“Filecoin gave an amazing deal to their buddies, just a few weeks ago.”

So what? That’s just kinda how the world works. Insiders get access to better deal flow for a variety of reasons. This is true in IPOs, where i-banks can only allocate limited shares to favored clients.

As a prospective Filecoin investor, I’m excited to see that these industry insiders put real skin in the game by investing $52m because they’re incentivized to help Filecoin succeed. Any one of these advisors could help a lot by doing high value activities (open doors for biz dev deals, help hire the right talent, etc.) that don’t require tons of time. It may not be clear which of the advisors will provide most value now. But that doesn’t matter so much to me vs. the fact that lots of industry players are invested in Filecoin and want it to grow.

If people want access to insider prices, then they should figure out how to become an insider. FWIW, I’m not an insider and didn’t have access to advisor prices. :)

“Filecoin is being insanely greedy…Call me old fashioned, but wanting to raise half a billion dollars for a pre-product endeavor is absolutely fucking insane.”

Given current market conditions, Filecoin team would be economically irrational (and perhaps insane) to not try to get as much money as possible in their ICO, especially since they don’t have to give up any equity. Ask any startup founder if they’d want to raise hundreds of millions of dollars in one shot without giving up equity. :) That being said, just because everyone wants that doesn’t mean that everyone can get that.

Your points that they might not be able to efficiently deploy that capital or that their product may not be worth as much as they raise are valid. I’m also concerned about that. But any charge of insanity should be directed at investors rather than at the team. This is very much a caveat emptor situation, and the people buying Filecoin tokens should know that.

Early clickers are incentivized, price unknown, network congestion.

Again, so what? They’ve been very direct about fact that paying via cash is fastest method. And anyway, they’re limiting investors to people who qualify as accredited investors.

Protocol Labs and Filecoin foundation are keeping 2x the coins that investors will get.

Another so what? So they’re keeping more value within the company and the foundation.

Here’s what I think the most important questions are:

Is Filecoin solving a real problem that is massive in scale?

The answer to this is yes. More than enough has been written about this by others.

Can the Filecoin team execute on their vision and realize the opportunity?

I think that this is maybe. Juan Benet seems like a really smart guy who has built a small company and cranked out some impressive tech. Does he have the skills to be the next Zuck, Vitalik, etc? That’s not clear to me. But he seems to have convinced a lot of smart investors who have experience making bets on startup founders.

Will value of tokens be higher in future if Filecoin team successfully executes?

This is also a maybe just because I’m not sure what the chances of their success are. My guess is that Filecoin will raise $200m — $300m since Tezos only raised $232m for an uncapped ICO. If they are successful at scale, then the value should be much higher than what people pay at ICO.

That being said, there are 2 things that the ICO has going for it that should help reinforce the value of Filecoin over time. First, the tokens vest over an extended period of time. This mitigates pump and dump by investors and also allows market to grow before investors can sell big chunks. Second, investors only own 10% of tokens. This means that most of the money goes to miners who are providing actual value on the Filecoin network by storing files. A distribution like Ethereum (2/3 to initial investors and 1/3 to miners after years) would actually hurt Filecoin’s chance of success since miners would have less incentive.

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